IATA TRAVEL AGENTS TO USE OWN CREDIT CARDS TO SETTLE BSP

IATA TRAVEL AGENTS TO USE OWN CREDIT CARDS TO SETTLE BSP FROM MARCH 2018

In a historic move, IATA has announced the adoption by the Passenger Agency Conference (PAConf) of a resolution that will pave way for travel agents to start using their own credit cards for BSP settlement.

IATA says in a statement, that the resolution text incorporates provisions related to Transparency in Payments (TIP), a new industry initiative. TIP reveals the different features and costs associated with each form of payment and agent remittance of airline funds. No form of remittance is barred by TIP, but travel agents can only use those forms to which an airline has previously given consent”.

This announcement will come as a relief to travel agents who have over the years petitioned IATA to allow travel agents to use their own credit cards to settle BSP. Section 1.4 of IATA Resolution 890 strictly forbids travel agents from using their own credit cards for payment. It reads “No Card issued in the name of the Agent, or in the name of a person permitted to act on behalf of the Agent, or in the name of the Agents officer, partner or employee, shall be used in connection with the sale of Members or Airlines Traffic Documents to any customer of the Agent.”

Aleks Popovich, IATAs Senior Vice President, Financial and Distribution Services says that transparency in Payments provides a pro-competitive framework for bilateral arrangements between airlines and travel agents that will facilitate the introduction of new and innovative payment solutions.

Despite tremendous advancement in payment solutions, airlines have always been reluctant to allow the use of travel agents credit cards with sources intimating that certain airlines have consistently frustrated efforts by PAconf to review resolution 890. The new change could be attributed to the coming into force of IATAs New Generation Settlement System (NEWGEN ISS). Early this year, IATA gave a clear pointer to what was in the offing by sending out a notice demanding that all IATA accredited travel agents become PCI DSS compliance effective 1 April 2017, a move many analyst saw as paving the way for this announcement.

Reacting to this announcement, KATA CEO Nicanor Sabula welcomed the announcement terming it as long overdue. “This should have happened many years ago. There is no reason why airlines delayed this decision despite all pointers indicating otherwise”. He further says that they will be reaching out to IATA to seek clarification on the meaning of the statement “TIP allows travel agents to use their own credit cards if an airline consents”. I sincerely hope that this is not another clever way by airlines to introduce hurdles that would ensure status quo obtains, he says.

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